Seven Fatal Flaws in the House Highway Bill

Why It’s Bad for America

By Donna Cooper
Posted on February 9, 2012, 9:00 am

At the January 31, 2012 press conference to announce the introduction of the American Energy and Infrastructure Jobs Act of 2012 (H.R. 7), the five-year highway funding bill, House Transportation and Infrastructure Committee Chairman John Mica (R-FL) proudly stated that it “may be the most important jobs measure to pass Congress this year.”

Sadly that’s just not the case. Highlights of the $260 billion bill are that it ends the 30-year practice of allocating a small portion of the federal gas tax for transit funding and as a result could make transit improvement subject to the vagaries of the annual federal-appropriations process. Meanwhile the bill relies on expanded oil-drilling licenses and federal employee pension contributions to pay for highway improvements.

The bill’s $52 billion of annual funding doesn’t even begin to meet the needs of our crumbling infrastructure, especially since it relies on outdated politicized formulas that send money to states irrespective of real infrastructure repair and improvement needs.

It’s unsurprising that the House leadership is under harsh attack for this bill, and the list of opponents is growing to include groups as diverse as the Club for Growth and Heritage Foundation as well as mounting opposition within the ranks of the AFL-CIO.

Yet this bill terminates the Reagan legacy of using a small portion of gas tax revenues to pay for mass transit. To assuage the pro-transit outrage, the bill cynically establishes a separate four-year fund for transit improvements. But that measure has been widely attacked by business leaders, mayors, and others who looked behind the curtain and found out that the special transit fund is far too small and worse yet dependent on imaginary annual appropriations of federal general-fund dollars. It’s a farce to think that general-fund dollars will be allocated for transit when the federal deficit is the Republicans’ favorite cudgel.

The inevitable result of this bill will be more Americans stuck in their cars, higher cost for American businesses that will pay truckers even more to sit in traffic, and higher fares for transit- and rail-reliant commuters.

Pollutes the air

It’s also going to be harder to breathe if this bill passes. Car and truck exhaust is largely responsible for some of our worst air pollution. Federally mandated vehicle-pollution controls help, but more cars on the road idling on congested roadways means more air pollution. In addition to the death knell to transit, the bill claims reforms to road permitting, which really mean less time to evaluate the impact of road projects on the environment. By eliminating a dependable funding stream for transit and fast-tracking highway improvement and widening projects, this bill will drive up pollution and make it harder for all us to get a breath of fresh, clean air.

Increases oil dependence while undermining oil-savings efforts

The bill shuns policies embraced by President Ronald Reagan while wholeheartedly adopting the Bush/Cheney drive to increase America’s reliance on oil. It’s no secret that oil is a finite resource, is expensive to extract, and poses untenable risks to natural resources (remember the BP oil spill?).

But facts be damned, this House bill undermines efforts to spur the development of new vehicle technologies. With the drive to dramatically expand oil drilling offshore and on protected lands, including the Arctic National Wildlife Refuge, the legislation sends a clear signal to investors in alternative fuel vehicles that oil is the fuel of choice.

This early valentine for the obscenely profitable Big Oil is allegedly in exchange for royalty payments that would be dedicated to fund this miserly highway-funding bill. Don’t be fooled, though. These revenues are not likely to be realized because as the U.S. Department of the Interior reports, oil companies are sitting on thousands of already licensed acres that are not under production.

Fails the funding test and asks workers to make up the difference

Transportation policy aside, this bill is a textbook case of fiscal irresponsibility. The Congressional Budget Office recently reported that on top of current gas tax receipts to fund highway and transit improvements, at least $69 billion must be found simply to maintain our current funding levels for the next five years. On February 7 the CBO released its estimate of how much revenue could be expected from the expansion in drilling, and it’s about $67 billion short of what’s needed to close the gap. Whoops.

As a result, on February 8 the House leadership unveiled its new plan to close the gap, which makes federal employees bail out the shortfall in the Highway Trust Fund through their pension contributions. It’s too soon to tell if this House proposal raises enough money to close the gap, but it makes no sense to make as many as 1.7 million federal employees shoulder the burden of rebuilding the roads, rails, bridges, and transit system for nearly 311 million Americans.

Relies on political formulas

The nation’s surface-transportation bill is widely viewed by members of Congress as a political exercise rather than a policy measure.[3] Although H.R. 7 is not weighed down by the 6,300 earmarks included in the 2005 authorization of SAFETEA-LU (the Safe, Accountable, Flexible, Efficient Transportation Equity Act for federal surface transportation spending), it holds fast to many of the same kinds of arcane formulas in that bill that reward political allies.

For instance, CAP’s analysis of the current formulas finds that they distribute nearly 10 times the amount of funding per capita to Alaska when compared to California. Meanwhile California has more than 52 times as many people as Alaska. It is home to the nation’s largest port, which means its infrastructure has to support the nation’s largest highway freight traffic. And California has 13 times the number of miles of roadways as Alaska.[4]

While Republican leadership touts this bill as making significant reforms, the basic allocation system is a tragic example of politics as usual.

Erodes our infrastructure

All of this begs the question: Does this bill address the surface-transportation needs of the nation?

Unfortunately, it does not. CAP’s analysis of the U.S. Department of Transportation’s estimates of needed improvements, crafted in 2008 before President Obama took office, found that at least $50 billion a year is needed to improve our roads and bridges. To keep our transit systems in safe, working order and able to stay up with growing demand, at least $15.7 billion more needs to be invested annually. Meanwhile Amtrak has a backlog of more than $8.8 billion in rail and train repairs.

This bill doesn’t spend one dime more than we are spending today on roads, and when it comes to transit and capital for our rail systems, the bill, for all intents and purposes, terminates all federal funding.

Time for a real highway bill

You know the bill is bad when U.S. Secretary of Transportation Ray LaHood, who served 14 years as a Republican member of Congress before taking the post, says, “This is the most partisan transportation bill that I have ever seen.”

To grow jobs, repair our infrastructure, and rebuild our middle class, the House leadership has to do a much better job of crafting a bill that works for America.

Donna Cooper is a Senior Fellow at the Center for American Progress.

Endnotes

[1] See the most congested roadways here: http://mobility.tamu.edu/files/2011/11/ccr-all-table-rankings.pdf#page=3

[4] Author’s calculations based on the 2010 Census, the Department of Transportation SAFETEA-LU State Apportionment Chart (2009), and Department of Transportation data on public road length, miles by ownership (2008).